FINALLY! Tumblr Will Start Selling Ad Units On May 2

In a 2010 interview with the Los Angeles Times, Tumblr CEO and founder David Karp said, "We're pretty opposed to advertising. It really turns our stomachs." How times have changed. Karp announced at Ad Age's Digital Conference that on May 2, Tumblr will start offering advertisers the ability to buy an ad unit on Tumblr Radar, which highlights the site's top posts and gets approximately 120,000 impressions a day. "I was probably being an idiot then," Karp said of his earlier renunciation of all advertising. His conversion is relatively recent—on April 12 he told Ad Age that advertising was "a complete last resort." Tumblr spokesperson Katharine Barna added that the real estate being offered to advertisers was "not an 'ad unit' per se, but a package of native promotion for the Tumblr post ― the most essential and versatile piece of our network." Brands have already taken advantage of using Tumblr as a platform. Lionsgate created a fashion blog called "Capitol Couture" to promote Hunger Games in January. Glasses shop Warby Parker created a mock Tumblr for April Fool's Day to sell glasses to dogs. (Photo to the right). Karp made the case for advertising on the social media site: "122,302 users signed up for Tumblr yesterday," he said. Tumblr has 20 billion posts and 50 million blogs. See Also:

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Warby Parker Launches New Pet Eyewear Vertical, Warby Barker, For April Fools

Today is April Fools, and we get the pleasure of sifting through all of the joke news. Like last year, when we were heartbroken to find the hippy girl who pitched a bottled air business to VCs was a prank. In light of the mischievous holiday, glasses company Warby Parker is announcing a new fake eyewear-for-pets vertical, Warby Barker. When you add the $95 canine glasses to your cart, an April Fools message pops up. The pictures are the best part. Go check it out.   Please follow SAI on Twitter and Facebook.Join the conversation about this story »See Also:GOLDMAN: The Next 24 Hours Will Be Critical For The Global EconomyForensic Expert: It's Not George Zimmerman Screaming For Help In The 911 CallsWhy Electing Mitt Romney Will Save The US Economy

The 10 Most Eligible CEO Bachelors

This is part of our series on The Sexiest CEOs Alive.  They're sexy. They're smart. They're powerful. They run big companies. And they're single. These CEO bachelors have it all—and women are lining up to meet them.  Many of these bachelors are in the tech world, but there are some in fashion and entertainment.Jeremy Stoppelman Company: Yelp Age: 34 Hometown: Arlington, VA Fun fact: Stoppelman has a dog named Darwin. David Karp Company: Tumblr Age: 26 Hometown: New York City Fun fact: He dropped out of high school at the age of 15 and was home-schooled after that. Daymond John Company: For Us By Us (FUBU) Age: 43 Hometown: New York City Fun fact: He started out making and selling tie-top hats on the streets of Queens, NY. See the rest of the story at Business Insider Please follow The Life on Twitter and Facebook.

Warby Parker Has Gained The Ultimate Ally

Eyeglass company Warby Parker is on fire.  The company is expanding all over the U.S. and taking on Luxottica, the behemoth that currently controls much of the world's eyewear.  Now, Warby Parker has gained a very powerful ally: J. Crew CEO and "merchant prince" Mickey Drexler, Michael J. De La Merced at DealBook reported. He has invested in the company and has been giving its founders advice on expanding into retail.  Drexler is the ultimate retail endorsement because he's credited with changing how America dresses. He turned Gap into a global brand and also turned around business at J. Crew.  “He was excited about some of the exciting retail stuff we were doing,” Warby co-founder Neil Blumenthal told DealBook. “When it was time to raise money, we wanted to get him formally involved.” The fact that Drexler is invested in the company bodes well for Warby. He's been referred to as "the man who dressed America" and his business sense of notoriously keen.  His endorsement means that Warby Parker has serious potential as a global brand.  The company is also rumored to be working with Google to make its high-tech glasses more aesthetically pleasing. SEE ALSO: Sears Once Ruled The World From This Decaying Office Tower In Chicago > Please follow Retail on Twitter and Facebook.Join the conversation about this story »

Here's The Real Reason GM Pulled $10 Million In Ads From Facebook (FB, GM)

General Motors pulled the entirety of its $10 million ad budget from Facebook after the carmaker asked if it could run page takeover ads—the large, intrusive kind of ads you often see on media sites—and the social network said no, Ad Age reports. The report touches on a key battle that will define the future of Facebook now that it's a public company: Whether Facebook should put its users' needs first by limiting the advertising they're exposed to, or whether Facebook should become more responsive to the companies that spend $1 billion per quarter or more advertising on it. Founder Mark Zuckerberg has been famously resistant to advertising. Post-IPO, however, his ability to maintain that resistance will likely be weakened by shareholders who want to see robust earnings growth. This year, Facebook already added Sponsored Stories to its mobile apps; a new daily deal-type format called Facebook Offers; and it's allowed advertisers to buy certain premium homepage slots without going through Facebook's ad sales force. Facebook currently allows takeovers on its logout page, but vp/global marketing solutions Carolyn Everson told Age she doesn't see home-page takeovers in Facebook's future. See Also:

The Facebook IPO: A Look Inside Its $1 Billion Ad Business

GM Pulled Ads After Facebook Begged It To Use Free Media

FURY AT FACEBOOK: General Motors Was 'Mental' To Pull Its Ads, Say Sources

FACEBOOK'S WORST NIGHTMARE: After GM, Here's How The Other Dominoes Could Fall

General Motors Pulls $10 Million Campaign From Facebook Because Its Ads Don't Work

  Please follow Advertising on Twitter and Facebook.Join the conversation about this story »

Why Tumblr Won't Tumble Like MySpace

Tumblr just hit a big milestone: 20 billion monthly pageviews. That's impressive for the blogging site, run by youthful CEO David Karp. But if you're familiar with older Web communities like GeoCities or Myspace, you know how traffic-driven success can be fleeting. GeoCities scored a $3.5 billion buyout from Yahoo, only to slowly wither. MySpace's users fled to Facebook, a competitor it used to mock. One of GeoCities' investors, Fred Wilson, is now an investor in Tumblr and Twitter. But he doesn't think either of those investments will suffer GeoCities' fate. Neither is littered with ads the way GeoCities was, Wilson said at the Ad:Tech conference earlier today. Instead, they're working on native advertising solutions that don't feel intrusive to a user, such as sponsored tweets and blog posts. Tumblr's Karp has been very cautious in how the site went about generating revenue. In other words, both Tumblr and Twitter are prioritizing great user experiences above making easy money from banner ads, which aren't very effective. Another differentiator: Tumblr and Twitter have feeds displaying users' activities, which makes the products more efficient from a user standpoint than older community-driven sites. "More important than the native advertising model is the feed," Wilson commented on a GigaOm article that compared Tumblr to GeoCities. "As i said at Ad:Tech today, the introduction of the feed into services like Tumblr, Twitter, and Facebook has made the consumption experience much cleaner and efficient than what existed on GeoCities and MySpace. It’s both of those things in concert, not one or the other." Please follow SAI on Twitter and Facebook.Join the conversation about this story »

It's Become Tragically Clear That Facebook Chased The Wrong Business For Years (FB)

Facebook has always sold ads the old-fashioned way, disguised as something new. Now, as Facebook has begun selling ads in a different, much more lucrative way that others have been doing for years, it feels like Facebook's tactic has put the company years behind schedule. How Facebook has sold ads for most of its history: Advertisers tick off a bunch of boxes on the type of people they'd like to reach and then Facebook shows their ads to these people. That's the "old-fashioned way," because that's basically how advertisers have been buying TV ads for decades. Advertisers have a group of people that they would like to market their products to, and they look for the TV shows that have that audience. In other words, they look for inventory that is targeted to an audience based on data a publisher provides about its audience. For the past five years or so, Facebook has sought to improve on this old-fashioned model by giving advertisers more detail about the type of people they can market to – more data. Instead of just knowing where those people are located, their gender, and their age, Facebook can tell advertisers where the people viewing ad inventory work, their marital status, and what their "interests" are. All this extra data was supposed to be a gold mine for Facebook, and Facebook built up a huge ad sales apparatus to sell ads targeted with it.   Eventually, Facebook's ad business grew to annual revenues of just under $5 billion per year. That sounds like a pretty big, but… It turns out this whole tactic may have been a big waste of everyone's time. That's because, in recent weeks, Facebook has begun selling ads in a new way that makes its massive inventory much more valuable – three times more valuable, according to one company buying the inventory and reselling it. This new method is called re-targeting. It has been used by ad-sellers outside of Facebook for years now.  Facebook, however, only began selling re-targeted ads this summer, when it opened something called the Facebook Exchange, better known as FBX in the industry.  FBX is what it sounds like: an exchange. Facebook has selected a dozen or so companies that will buy Facebook ad inventory and sell it to marketers using re-targeting. How re-targeting works: You visit Warby Parker, the online glasses seller. You look at a pair of glasses you might like to buy. You decide not to buy them right then. You leave the Warby Parker website. Later, on other Websites, you  see ads with the pair of glasses you liked.   You see those ads because when you visited warbyparker.com, your browser downloaded a tiny piece of software, called a "cookie," that told the ad servers on sites using re-targeting that you had previously gone to warbyparker and looked at a certain pair of glasses. Ads that are "re-targeted" in this way are clicked on a lot, and it's pretty obvious why. Unlike most ads in banners on the Internet, re-targeted ads are ones that you may actually want to see because they are based on your demonstrated interest in a product. Because they are clicked on so much – and because those clicks so often lead to sales, re-targeted ads are valuable, and publishers are able to charge advertisers steeper rates for them.  That's good new for Facebook. How good? Zach Coelius, CEO of Triggit, one of the ad-reselling companies Facebook has invited onto FBX, says that return on investment for advertisers buying through FBX is so good, that if all of Facebook's ad inventory were sold with re-targeting, instead of user data targeting, Facebook would be able to charge 3X the price it charges for ads right now. What's truly remarkable is that inventory sold through FBX re-targeting uses ZERO Facebook profile data, and yet it is much more valuable. This has to make you shake your head about Facebook's strategy for the past few years, and we'll get to that in a second. Coelius has a stake in seeing FBX do well, and having business news outlets write stories about how Triggit is getting great ROI for its clients. So you have to take his claims with a grain of salt. That said, his claims make intuitive sense.  The most valuable inventory for retargeting until now has been Yahoo Mail, because… It has huge scale It's engaging enough that you'd only want to click on ad to leave if you really wanted to leave. The people who use it tend to leave it open as a tab in their browser all day. In all three ways, Facebook.com is very similar to Yahoo Mail. So, when Coelius says that 18 months from now, most of Facebook's ad inventory will be sold through retargeting, and that rates will have gone up by a couple multiples, we find him to be credible enough.  On a basic level, of course ads targeted to me based on my demonstrated commercial intent will be more valuable than ads based on what I put in my Facebook profile. OK, I "like" the British Open golf tournament, and that probably means aspirational brands could do well to market to me – but that seems like a lot of guesswork compared with showing me an ad for a pair of glasses I almost bought two days ago. Because it knows what marketers drooling-ly call "intent," retargeting feels a lot closer to search than Facebook's profile data targeting does, and Google has shown us how great an online ad business can be when it is built around intent and massive scale. The frustrating thing for Facebook shareholders, especially the ones who bought in on the IPO, has to be this:  Facebook may be new to re-targeting, but re-targeting isn't all that new. As noted above, Yahoo has been doing it, and doing it well for years. It's ironic – and a little tragic – that Facebook spent so much time chasing a "new and improved" form of advertising, when an existing online tool works so well. The good news is that retargeting should be a growth engine for Facebook, which desperately needs one, even if we don't think (ahem!) FBX meaningfully boosted Facebook revenues in Q3. Please follow SAI on Twitter and Facebook.Join the conversation about this story »

There's A Huge Flaw In Yahoo's Monetization Plan For Tumblr (YHOO)

When we published a leaked copy of Tumblr's ad sales pitch deck on the day Yahoo acquired the social blogging site, you may have noticed some odd language on the last page: The part that says "non-targeted." Why would Tumblr be offering "non-targeted" advertising for $200,000 per campaign? The whole point of advertising on the web is that it is highly targeted: You can target people by purchase history on Amazon, by shopping intent on Google, by demographic on Facebook, and reader interest when you choose specific, niche publishers. We asked a Tumblr representative to tell us what the targeting options were for Tumblr's new "in-stream" ads that will show up in their dashboard newsfeeds. But we haven't heard back yet. Three sources, however, tell Business Insider that Tumblr's ad targeting is in fact just as modest as the pitch deck suggests it is. "Fairly dismal" "It is fairly dismal," said one ad buyer. "I've never ever heard any of our customers ask about Tumblr ads, maybe a handful ask us about Tumblr analytics," with the exception of one standout client that the source declined to name. Another source told us, "They don't know much about people [their members] and targeting is very, very limited. They only recently enabled targeting for U.S. only!" One huge issue for Yahoo is that currently there is very little inside Tumblr to target. Users can get an account with an email address and by filling in their age. They don't have to provide any other identity information. Tumblr is thus filled with people using names that don't even identify them as male or female. It's the opposite of Facebook, which has dozens of "real identity" fields that gather targeting information from users. Tumblr, in fact, has the same targeting problem that Twitter has: It literally doesn't know who its members are. "Not robust enough" Tumblr's ad targeting metrics are therefore thin, Mashable noted recently: Beena Kalaiya, associate director, strategic insights and social media at media-buying firm Optimedia, says that Tumblr doesn't provide the sort of metrics that advertisers are used to. "The analytics are better than they used to be, but not robust enough," she says. "I'm hoping that Yahoo helps in that respect." (We also contacted Union Metrics, Tumblr's official content analytics agency, for comment, but the company demurred — it focuses on content not advertising metrics.) One targeting option Tumblr does have are the tags and text that users publish in their posts. Someone tagging a post with "soccer" is probably a soccer fan, and thus could be targeted with sports-relevant ads. One source tells BI that this is a huge plus for Tumblr: "keyword search or running NLP [natural language processing] on the blog posts as well, to better target ads that Yahoo will obviously now drive [is] probably more relevant than any kind of registration data, in my opinion." But even that kind of targeting is under-utilized, another source tells us: "There’s not much targeting – basically U.S. or international, and mobile and/or desktop. No demo/context/interest opportunities yet," this source says. "Given the overall low reach versus Facebook and Twitter, Tumblr can’t offer up much in the way of precise targeting because that sort of thing wouldn’t scale for advertisers." "They can match their data with Yahoo's" A separate source says Yahoo's targeting know-how can only help Tumblr. "They can match their data with Yahoo's to improve targeting possibilities." Yahoo has made two suggestions about hot it might target ads on Tumblr. The first is by utilizing its new Yahoo news in-stream ads. Those ads become more relevant to users as they search and read more Yahoo content. It's easy to imagine how the relevancy of ads in Tumblr might increase based on the same mechanism. The second way is via a Tumblr ad exchange. On the day of the acquisition, Yahoo CEO Marissa Mayer hinted she might create an ad exchange for Tumblr. Such an exchange works by dropping a tracking cookie onto the browser of any incoming Tumblr user. That cookie would signal to users that a new Tumblr user has arrived in the system. Advertisers could then see what other cookies that user might have collected from previous sites, and then target that user with ads inside Tumblr based on their browsing history.SEE ALSO: Tumblr's Ad Sales Pitch Deck Says Brands Will Now Be 'Front And Center' Please follow Advertising on Twitter and Facebook.Join the conversation about this story »    

Why Yahoo Might Pay $1 Billion For Tumblr Even Though It Only Has $13 Million In Revenue (YHOO)

If Yahoo! buys Tumblr for $1 billion, as some reports have suggested, one fact is likely to get cited a lot when the deal is announced: That Tumblr had only $13 million in revenue in 2012, after taking $125 million in investor funding.With lousy economics like that, why would Yahoo even consider such a high price?It's worth comparing a putative Yahoo-Tumblr deal to Facebook's $1 billion acquisition of Instagram last year. And not simply because the headline price is the same.It turns out there are a lot of similarities between the way Yahoo and Tumblr might work together, and the way Facebook and Instagram now work together.Clearly, Tumblr's business is embryonic at best.Tumblr CEO David Karp used to be actively disinterested in advertising. (He once said it "turns our stomachs.") he preferred to perfect Tumblr's user experience and scale up its member base. Back in 2011, Tumblr's sponsorship efforts were a joke. It only began taking ad dollars a year ago. More recently, however, Tumblr has taken several steps that show it is serious about monetizing its 90 million daily posts from its 100 million bloggers. A lot of them are reminiscent of Facebook's path to its IPO and after that the acquisition of Instagram: Tumblr has started offering sponsored posts in the feeds of mobile users, just like Facebook does with "sponsored stories." It hired a new head of ad sales, Lee Brown, from Groupon. When Facebook hired Carolyn Everson as head of its ad sales, from Microsoft, it changed the way ad agencies viewed the site — and money began pouring in. Tumblr has named a Creative A-List of agencies it likes to work with — a bit like Facebook's Preferred Marketing Developer list of approved ad suppliers. Tumblr has begun to beef up its analytic offerings — because advertisers don't want to touch media if they can't measure what they're getting for their money. Tumblr suffers from the same initial problem advertisers had with Facebook: That once brands have made a few posts on their Tumblr, they get bored of using the free tools and their activity drops off. Creating free content that's cool and engaging is difficult and time consuming. It's easier to just advertise and pay for the forced exposure. And advertisers have grumbled about not "getting"  Tumblr, just as they used to about Facebook. Digiday reported, "One provider of social management tools said literally no clients had pushed for Tumblr to be included. That’s a major red flag." What most people misunderstand about Tumblr, and what Yahoo may feel is worth paying for, is that Tumblr is NOT best described as a "blogging platform." Sure, users have blogs on which they post things. But once you're a Tumblr user, you find that the real fun of Tumblr is building a news feed that only you can see from other users you like. Want an all-skateboarding, all the time news feed? Tumblr. As members begin to follow each other, they can start messaging each other. The real party on Tumblr is going on behind the dashboard, not on the blogs' outer faces.That party is why Tumblr has become so big among young people — it's basically a cool social hangout that their parents haven't figured out yet.Tumblr's dashboard feeds are obviously easy to monetize in the future, just as Facebook and Instagram's friend feeds are and will be.Which is why $1 billion suddenly doesn't seem completely crazy for a $13 million startup.SEE ALSO: Here's Tumblr's Total Revenue For 2012 — And How It Will Make A Profit In 2013 Please follow Advertising on Twitter and Facebook.Join the conversation about this story »    

Big Advertisers Are Saying Lots Of Things About Facebook This Morning And Few Of Them Are Good (FB)

At our Social Media ROI conference this morning, Facebook has been a big topic of conversation. And the comments from marketers have not been encouraging for Facebook's bottom (or top) line. All the brands have tried Facebook, of course. But they've had mixed success. And, importantly, a lot of the success stories have come through companies using Facebook as a platform to interact directly with customers, rather than as a paid advertising medium. Gilt Groupe, for example, was one of the first companies to set up a store on Facebook. It flopped. Why? Because people don't go to Facebook to shop, said Gilt Chairman Susan Lyne. They go to hang out and chat with their friends. Selling things on Facebook, Lyne said, is like selling things in a bar. Lyne said Gilt has had exceptional success on Pinterest, Instagram, and Twitter, albeit for different brands. Pinterest has been huge for JetSetter, because of all the beautiful travel pictures that JetSetter has pinned and encouraged followers to re-pin. Gilt City, meanwhile, has given Twitter followers freebies for tweeting about the latest deals they've gotten and invited Instagram followers to take and share pictures of their cities. (Facebook owns Instagram, so the news isn't all bad.) Gilt does spend some money advertising on Facebook, but most of its social-media budget is devoted to its own promotions and people. Dave Gilboa, the co-CEO of Warby Parker, a new online eyewear retailer, said "Facebook advertising hasn't worked." Warby has benefited heavily from Facebook word-of-mouth, but that's because Facebook users have used Facebook to spread the word about Warby. And they've done this in part because of articles that have been written about Warby that have been shared by Facebook users--not because Warby has spent money advertising on Facebook. Gilboa added that "90%" of the interactions Warby Parker has with people on Facebook are customer-service interactions. Meanwhile, Adam Kmiec, the Global Director of Digital Marketing and Social Media at the Campbell Soup Company, said Facebook "is the most A.D.D. company I've ever seen." Kmiec says Facebook has changed its ad products every few months, creating tremendous confusion among its clients. Kmiec suggested, for example, that Facebook may be about to kill "Reach Generator," a huge product it announced a huge launch conference earlier this year in New York. Until recently, Kmiec said, Facebook has also refused to share much data with its clients, making it "really tough for marketers and partners" to judge how their campaigns and content are doing. Twitter, on the other hand, Kmiec says, has created spectacular tools for marketers. And this has helped Twitter gain strong early traction. The message we've heard over and over again this morning is that the social platforms are excellent (critical) tools with which advertisers can interact with customers and potential customers, but that this is not the result of the advertisers spending money advertising on the platforms. Pinterest, for example, doesn't even accept advertising yet. And much of the value that advertisers can get out of Facebook comes from the advertisers' own efforts and investments and people, not Facebook advertising. Kmiec of Campbell Soup put it this way: "The answer isn't Facebook. The answer is your social strategy." "The mad rush to Facebook [is over]," he said. Please follow SAI on Twitter and Facebook.Join the conversation about this story »